FCC Stops Mandated DSL-Sharing by Telcos, Places Telephone and Cable Companies on Equal Footing

WASHINGTON, D.C., Aug.8, 2005/Satnews Daily/ — The Federal Communications Commission on Friday voted to end regulations requiring incumbent telecommunications carriers to share their DSL broadband connections with competitors.

Voting 4-0, the FCC removed rules that allowed competitors such as Earthlink to offer DSL over lines owned by the four giant incumbent telecom carriers, often called the Baby Bells. FCC said the new policy will bring more and better broadband services to consumers by eliminating facilities sharing requirements on facilities-based wireline broadband Internet access service providers.

“The changes will enable wireline broadband Internet access providers to respond quickly to consumer demand with efficient, innovative services and spur more vigorous head-to-head competition with broadband services provided over other platforms,” FCC said. It added the action responds to market and technological changes marked by growth in the use of the Internet for communications and the availability of Internet service from multiple broadband pipelines, including cable, wireless, satellite, and power line networks.

The Order adopted by the Commission puts wireline broadband Internet access service, commonly delivered by digital subscriber line (DSL) technology, on an equal regulatory footing with cable modem service, currently the market leader. 

FCC Chairman Kevin Martin called the decision "momentous" and predicted that consumers will benefit from a "leveling of the playing field" between DSL and cable modem service.

“I believe that, with the actions we take today, consumers will reap the benefits of increased Internet access competition and enjoy innovative high-speed services at lower prices.” He cautioned, however, there is more to do to stimulate infrastructure investment, broadband deployment, and competition in the broadband market. 

FCC said the decision is consistent with a recent U.S. Supreme Court decision upholding the Commission’s light regulatory treatment of cable modem service. Consistent regulatory treatment of competing broadband platforms will enable potential investors in broadband network platforms to make market-based, rather than regulation-driven, investment and deployment decisions.

In its new Order, redefined wireline broadband Internet access services as information services functionally integrated with a telecommunications component. In the past, the Commission required facilities-based providers to offer that wireline broadband transmission component separately from their Internet service as a stand-alone service on a common-carrier basis, and thus classified that component as a telecommunications service.

The Order, however, eliminated this transmission component sharing requirement, created over the past three decades under very different technological and market conditions, finding it caused vendors to delay development and deployment of innovations to consumers.

To ensure a smooth transition, the Order required facilities-based wireline broadband Internet access service providers to continue to provide existing wireline broadband Internet access transmission offerings, on a grandfathered basis, to unaffiliated ISPs for one year.  The Order also requires facilities-based providers to contribute to existing universal service mechanisms based on their current levels of reported revenues for the DSL transmission for a 270-day period after the effective date of the Order or until the Commission adopts new contribution rules, whichever occurs earlier. 

FCC said if the Commission is unable to complete new contribution rules within the 270-day period, it will take whatever action is necessary to preserve existing funding levels, including extending the 270-day period or expanding the contribution base.

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